Palo Alto Weekly

News - January 15, 2010

Parcel tax committee chairs pledge positive campaign

Palo Alto Board of education places measure on May 4 ballot

by Chris Kenrick

Three parents leading the effort to renew Palo Alto's school parcel tax vowed Tuesday to mount a campaign that will unite the community around its schools.

The three, Tracy Stevens, Anna Thayer and Al Yuen, introduced themselves to the Board of Education just prior to a unanimous board vote to place the $589-per-parcel tax measure on the May 4 ballot. If passed by a two-thirds majority, it will replace the current $493-per-parcel tax, which expires next year.

"This campaign is absolutely the most critically important thing I could be doing with my time," said Thayer, a PTA executive board member and mother of four children who attend Fairmeadow Elementary School and Gunn High School.

Yuen, whose family immigrated to the United States from Taiwan when he was in second grade, said his father instilled in him "a need to pay back, to fulfill a lot of the things we got growing up in the United States." He is the father of four boys.

Stevens, a Stanford resident whose two children attended Nixon Elementary School, Terman Middle School and Gunn High School, said parcel-tax campaigners aim to achieve the twin goals of uniting the community and "reminding ourselves why our schools are so successful."

Noting the state financial crisis and the fact that parcel-tax funds are completely locally controlled, Stevens said, "At this time, this district should continue to represent what public education can be at its best."

The co-chairs said the campaign will be called Support Palo Alto Schools 2010, and that it will launch a website, supportpaloaltoschools2010.org, by next week.

The proposed tax would replace the current parcel tax and increase it by $96 a year. The current tax generates about $9.4 million a year, about 6 percent of the school district's operating budget.

Like the current parcel tax, the proposed replacement would last for six years and have an optional waiver for seniors.

Palo Alto resident Roberta Stone spoke against the proposed tax, which does not allow a waiver for low-income homeowners.

"I believe the goals of this parcel tax are very important and admirable, but I don't believe the means for achieving that goal are ethical," Stone said. "A flat tax of close to $600 places a very significant and harmful burden on the low-income residents of the city, the homeowners who are low-income or very low-income."

In response, district staff members said state law does not allow them to offer a waiver of the parcel tax for low-income residents.

Staff Writer Chris Kenrick can be e-mailed at ckenrick@paweekly.com.

Comments

Posted by John, a resident of Midtown
on Jan 13, 2010 at 9:31 am

I agree that a flat tax is unfair. More fair would be a tax based on property value or property square footage or family income.


Posted by parent, a resident of Fairmeadow School
on Jan 13, 2010 at 9:56 am

Was there a school bond measure passed last year during the election? I thought that was to replace the current 493-per-parcel tax.


Posted by bikes2work, a resident of Another Palo Alto neighborhood
on Jan 13, 2010 at 10:00 am

".... and an optional waiver for seniors."

This is the ONLY reason the campaign will be positive. Why does state law allow the exemption of seniors from this tax? Seniors already get a HUGE tax break from Prop. 13. I'd be willing to bet that over half of the homes in Palo Alto pay less than $2000 in property tax. Meanwhile, anyone who has bought in the last 10 years pays over $10,000!!!


Posted by a parent, a resident of Southgate
on Jan 13, 2010 at 10:29 am

I have the same question as the Fairmeadow parent. We have passed a measure (or something) in 2008 to replace/extend this $493-per-parcel tax. Am I right? Can someone clarify this? Thanks.


Posted by pa resident, a resident of Palo Alto Hills
on Jan 13, 2010 at 10:46 am

The parcel tax that passed in 2008 was to upgrade facilities in Palo Alto High and Gunn and some upgrades to other schools. This parcel tax is for operations that is it is used for salaries and other ongoing operations for the school district.


Posted by Chris Kenrick, Palo Alto Weekly staff, a resident of Old Palo Alto
on Jan 13, 2010 at 10:46 am

"Parents" of Fairmeadow and Southgate,

The 2008 vote was for a $378 million facilities bond measure to fund long-term upgrades to Palo Alto's 17 campuses. It's intended to equip the schools for the next four decades and was approved by 78 percent of district voters in June 2008. The five new buildings at Paly and Gunn (Web Link) now pending before the school board are part of this long-term facilities program.

The parcel tax has been paid by local voters for about 10 years and supports the annual operating budget of the schools. The current annual $493-per-parcel tax generates about $9.4 million a year, 6 percent of the district's operating budget. The school board is seeking to replace that tax at $589 per parcel.

An easy way to think of it is that the bond is for facilities and the parcel tax is for operations.


Posted by Resident, a resident of Another Palo Alto neighborhood
on Jan 13, 2010 at 10:56 am

Just a reminder, the bond for the library upgrade has not appeared on our property tax bill yet so don't forget about it. Many of the school PTAs were backing this project so much that many thought of it in the same mindset as a school bond. The way things are going, we will have a lot more to pay for and as far as the library goes, nothing to show for it.


Posted by No way, a resident of Midtown
on Jan 13, 2010 at 11:08 am

Who decided that it should be a flat tax and not a tax based on lot size or house value or whatever? Why is a flat tax more fair?


Posted by Frank, a resident of Ventura
on Jan 13, 2010 at 11:16 am

It's unfortunate that we have to keep passing these convoluted taxes / fees to fund our schools properly. But it seems to be what we have to do.

I'm sympathetic to low income families who must pay as much as the more fortunate families but I also wonder how many families own property in Palo Alto on an income of $14,000 a year.


Posted by Parent, a resident of Fairmeadow
on Jan 13, 2010 at 11:32 am

Thanks Chris for clarifying. And indeed I did not realize that the tax for the library upgrade has not even shown up on my property tax bill yet. We simply aren't able to keep up with the tax increase in this economy.


Posted by Toady, a resident of Old Palo Alto
on Jan 13, 2010 at 11:39 am

"Why is a flat tax more fair?"

Tell me how it isn't.


Posted by What is Fair, a resident of Midtown
on Jan 13, 2010 at 12:20 pm

So low-income residents pay but high-income seniors do not?


Posted by John, a resident of Midtown
on Jan 13, 2010 at 12:30 pm

A tax based on property value or property size is much fairer than a flat tax.


Posted by resident, a resident of Another Palo Alto neighborhood
on Jan 13, 2010 at 12:37 pm

"A tax based on property value or property size is much fairer than a flat tax."

By property value, do you mean the value that your current property tax is based on, or the TRUE value of the property?

In my opinion, the TRUE value of the property is fair. The property size makes sense too.


Posted by Toady, a resident of Old Palo Alto
on Jan 13, 2010 at 12:43 pm

"A tax based on property value or property size is much fairer than a flat tax."

How?


Posted by Just a Mom, a resident of Old Palo Alto
on Jan 13, 2010 at 12:48 pm

If your kids actually attend Palo Alto public schools, you will get asked for even more money from PIE and PTA.


Posted by Erin, a resident of Leland Manor/Garland Drive
on Jan 13, 2010 at 1:05 pm

I'd like to know how many high-income seniors you really know. Actually the seniors who ask for an exemption is relatively low. This city has a history of supporting the schools and that includes the seniors who can afford it. There are many seniors who continue to give thousands of dollars to the schools even though they have no children or grandchildren in the district. A little more respect would be nice.


Posted by Fair is Fair, a resident of Barron Park
on Jan 13, 2010 at 1:38 pm

"Why does state law allow the exemption of seniors from this tax? Seniors already get a HUGE tax break from Prop. 13. "

Yup, it's another transfer of wealth from the young to the old.

I'll vote no purely because of the senior exemption.


Posted by Jerry, a resident of South of Midtown
on Jan 13, 2010 at 2:25 pm

While it's true we seniors benefit from prop 13, let me assure you many of us are low income, can't afford a retirement community , don't drive new cars ( mine is a 1994), and spend more than their share on medical bills; and if it ever comes to pass hopefully their house will cover the cost of long term care because we couldn't afford to buy long term care insurance. Avoiding the parcel tax is one of our few options. We did our share in our time.


Posted by another parent, a resident of College Terrace
on Jan 13, 2010 at 2:31 pm

For those of you complaining about seniors getting exemptions, please remember that when you turn 65 you never ask for the exemption! Also, I hope you won't take the movie discount or any other discount for seniors.


Posted by kfarad, a resident of Midtown
on Jan 13, 2010 at 2:48 pm

NO NEW TAX!

PAUSD has too much money as it is! They're swimming in money and they try very hard to spend it all to make it look like they need it. I know because I used to work there!


Posted by Fair is Fair, a resident of Barron Park
on Jan 13, 2010 at 3:19 pm

Jerry,

"While it's true we seniors benefit from prop 13, let me assure you many of us are low income"

Taking you at your word, your point seems to undercut a blanket exemption for seniors but support one for those with a low income, right?

Well, you may be low income, but you are very wealthy--you own Palo Alto real estate, so your argument doesn't cut it.

It's unreasonable to ask others for handouts when you stand to cash out great wads of money on your house.

Another parent,

"For those of you complaining about seniors getting exemptions, please remember that when you turn 65 you never ask for the exemption!"

Er, choose to get shafted a second time? No thanks.


Posted by bill, a resident of Barron Park
on Jan 13, 2010 at 4:13 pm

kfarad. A person with a home is not "swimming in money". They simply have property they must maintain and pay taxes on. Until they sell the property, there is no discretionary money.


Posted by Fair is Fair, a resident of Barron Park
on Jan 13, 2010 at 4:30 pm

Bill,

"A person with a home is not "swimming in money"." If they have a house in PA, they are.

"Until they sell the property, there is no discretionary money." So what? They still have the wealth--they've just put it in a particular form. If that's the only objection, liens are the answer.


Posted by citizen parent, a resident of Midtown
on Jan 13, 2010 at 5:05 pm

PAUSD needs the funds, but the lesson to draw from the facilities bond, Measure A, is that it's not enough for the district to say it's for upgrading facilities or for operations -- make them be specific BEFORE we vote on it so they're less prone to wasting our money on personal agendas (as seems to be happening with facilities), and they won't be able to treat the public like we're beside the point in how they spend the money. This is the only time they'll be accountable.


Posted by Resident, a resident of Another Palo Alto neighborhood
on Jan 13, 2010 at 5:09 pm

Doesn't really matter what they say. When this was instituted it was to keep class sizes small in the early grades. Now they are ignoring that and increasing class size.


Posted by parent, a resident of Palo Alto High School
on Jan 13, 2010 at 8:32 pm

The school district and real estate agents in this town know how to play to the fear of recent homebuyers. Don't buy into it, and vote NO. Why isn't a lawsuit being brought forth to challenge the senior exemption? The same folks who brought you the first parcel tax knew that if seniors weren't exempt, the measure would never pass with the required 2/3 majority. Remember every school district in the area is faced with the same issue. If palo alto doesn't pass this parcel tax, are people really going to sell up and move to Sunnyvale, Cupertino, etc?

By the way, donations to PTA and PIE have stopped in our household. Our "donation" is going to pay for the present parcel tax. Learn to say NO!


Posted by chris, a resident of University South
on Jan 13, 2010 at 10:18 pm

Most people are taking salary cuts. Why are the employees of the school district exempt?

This tax is extremely regressive and unfair.

Voluntary donations and pay cuts are the way to go.

If the parcel tax will only account for 6% of the district budget, a small salary cut should handle the deficit very easily.


Posted by Checking other cities, a resident of Barron Park
on Jan 13, 2010 at 10:24 pm

"Remember every school district in the area is faced with the same issue."

Yes, and many have resorted to parcel taxes. Just for reference, Mountain View ($127-$1016 depending on lot size), Cupertino ($125), and Los Altos ($597), and Menlo Park ($499, permanent and adjusted for inflation) all have parcel taxes. Sunnyvale and Santa Clara recently voted against parcel taxes.


Posted by KG, a resident of Duveneck/St. Francis
on Jan 13, 2010 at 10:52 pm

How about anyone that can't afford it or does not approve of it can opt out.


Posted by empty pockets, a resident of Fairmeadow
on Jan 14, 2010 at 8:31 am

PAUSD can do more to trim it's budget but refuses due to small groups who want their boutique program. PAUSD must realize that it needs to start biting the bullet and trim down some of these programs so that it can provide the basic education it is supposed to provide.


Posted by Pro Schools, a resident of Greenmeadow
on Jan 14, 2010 at 9:16 am

87% of the PAUSD budget is for salaries. PAUSD is engaged in a systemic cost-cutting exercise which will be needed even if this parcel tax passes. If it does not pass, cuts will become truly draconian. Teacher layoffs are very likely, and class sizes will have to truly explode.

Between budget cuts, the parcel tax, and spending down reserves, PAUSD management is taking an extremely careful, multi-pronged approach to dealing with a truly ugly budget situation. The proposed tax is a fiscally sound part of a thoughtful and comprehensive strategy to try to maintain this district as state contributions and property taxes plummet.

If there were no corresponding cuts or spending of reserves, one could say that the district was being careless and profligate. But that isn't the case. Renewing this tax is ESSENTIAL for keeping Palo Alto schools strong. Strong Palo Alto schools are ESSENTIAL for insulating our community from the extreme degradation other communities have experienced in property values.

Tiered parcel taxes have been challenged in courts. There are not a lot of options for districts who need to raise money to support operating funds. Palo Alto must pass this parcel tax to preserve our schools and our property values.


Posted by parent, a resident of Crescent Park
on Jan 14, 2010 at 10:53 am

Why is the school district exempt from planning for the proverbial "rainy day" which seems to have been the norm during the past few years. Projections during rosy economic times seem to account for no possibility of downturn. Is this good management? Why bail them out yet again. Let's hire lots, and let them retire early. This mindset needs to change. Along with the parcel tax there should be a moratorium on hiring of any kind to reduce the 87% salary overhead. You are far better off paying for dedicated help one on one to supplement what the school does anyway. At least you know your child is getting dedicated attention.


Posted by palo alto mom, a resident of Embarcadero Oaks/Leland
on Jan 14, 2010 at 11:17 am

Parent of Crescent Park - PAUSD does have a "rainy day" fund called reserves which are being used. I think there is already a hiring freeze for any non-classroom position. The District just conducted a survey asking for feedback on where to save money, did you give them feedback? The "bail out" is needed not because of District mismanagement but because of the state of our State finances.

And not everyone can afford to pay for one on one tutoring.

Pro Schools - very well said!


Posted by Senior from the South, a resident of Fairmeadow
on Jan 14, 2010 at 1:17 pm

Bikes2work (third from top), how much money would you be "willing to bet that over half of the homes in Palo Alto" are owned by Seniors paying less than $2000 in property taxes? I'm willing to bet the value of my house that you won't put your money where your mouth is!

My Senior household (age 67) pays about $6K for a house bought 18 years ago in the "poor" part of town. I figure that someone who pays only a third of what we pay in tax must have bought their low-value property in the 70's or earlier to owe less than $2K in 2010. There are indeed a few other Seniors in my low-price neighborhood, but collectively we don't live in anywhere near half the houses. Some of us can afford the parcel tax, but I know of one octogenarian trying to make it on an income of $1K/month.

Take a look at Palo Alto's demographic figures at Wikipedia. The 2000 census showed 15.6% of Palo Alto's population at 65 or older. I doubt that percentage has changed dramatically in the last decade, so I think you'll have to concede your estimate of low-tax homeowners was quite inflated.

So, why don't I just hop on my bike and I'll meet you somewhere so you can pay off your bet!


Posted by neighbor, a resident of Greenmeadow
on Jan 14, 2010 at 4:22 pm

This parcel tax is, as several people noted, a highly regressive tax. When someone with a small condo has to pay the same amount as HP with their acres of property, or someone with a $2million house, how can that be fair?????

By my conservative estimates, the tax rate (by proportion of property value) for someone with a $700k condo is 7 times greater than for someone with a $3million home, and 140 times more than a business sitting on property valued at $10million (i.e., big companies). Because it is usually safe to assume that someone living in a small condo earns less than someone in a high-value home, this tax meets the definition of a regressive tax (i.e., in a progressive tax, the more you earn, the higher your tax rate. In a regressive tax, the less you earn, the higher your tax rate).

I think it is a good thing to allow senior exemptions for those with fixed incomes, but object to someone being able to vote for a tax they can then opt out of. The number of seniors who opted out after the last parcel tax vote was NOT INSIGNIFICANT -- the school district issued a statement that between 1200 and 1300 opted out. That's $600,000 of income for the school district. If you don't want to pay for it, don't vote for it. Again, a fairness issue -- why does someone get to vote for a tax that will rest on the shoulders of others?

Also keep in mind that the tax proposed is only the starting point -- they are also asking for a 2% raise in the tax rate each year (please correct me if this is inaccurate), which means a 16% increase over the course of the tax period. That's higher than the projected rate of inflation.

Finally, the average pay (average, mind you, not highest)for PA school teachers is approximately $83,000 for a 9-month calendar (over $100k/year prorated). That's more than many residents of Palo Alto earn. The school district is very top heavy -- consolidation of adminstrative functions makes much more sense than overtaxing residents. Our school district needs to do more belt-tightening and not continue to give raises in hard times -- many public funded organizations are furloughing workers. Certainly PA can carry their fair share by not continuing to ask for raises.

In short, I encourage everyone to seriously consider the wisdom and fairness of this tax. VOTE NO!


Posted by chris, a resident of University South
on Jan 14, 2010 at 5:29 pm

Let's see if the campaign tells you that you cannot deduct the parcel tax on your income tax return.

How well do they know their tax law and how honest will they be?

Only property taxes that are based on value can be itemized on your Federal income tax return.


Posted by george, a resident of Another Palo Alto neighborhood
on Jan 14, 2010 at 5:32 pm

Pro Schools,

Have you ever heard of salary cuts?


Posted by Ms Over Taxed, a resident of Green Acres
on Jan 14, 2010 at 5:37 pm

>> Parcel tax campaign will be positive, chairs say.....

How is it a positive that you want to use the law to help yourself to my money?

MY MONEY fist off is MINE and is needed for my family, my children, my life.

JUST SAY NO.


Posted by Not the IRS, a resident of Barron Park
on Jan 14, 2010 at 5:58 pm

"Let's see if the campaign tells you that you cannot deduct the parcel tax on your income tax return."

Then how come most parcel tax campaign states that it is deductible? For example:

Web Link

Web Link

Web Link

Web Link


Posted by Anony Mouse, a resident of Midtown
on Jan 14, 2010 at 9:18 pm

Anony Mouse is a registered user.

Quoting Neighbor here:

"Finally, the average pay (average, mind you, not highest)for PA school teachers is approximately $83,000 for a 9-month calendar (over $100k/year prorated). That's more than many residents of Palo Alto earn."

I always find this logic interesting. By this reasoning, all teachers should make less than the average salary of the residents of Palo Alto? Does this include stock options? Should teacher pay be tied to the salary of the retail workers in Palo Alto? Or, is it just the arbitrary idea that teachers should be poorly paid?

The whole 9 months of work thing is great too. Please, put me on the 12 month plan and increase my salary accordingly. The problem is, that would require more taxes to finance. Also, this would put the average salary above $100,000. That would be hard to swallow for the condescending folks. The six-figure salary is a problem. "My son's teacher, who has more years of education than I do, has gone through numerous certification hurdles makes more than I do?" Shocking.


Posted by Fair is Fair, a resident of Barron Park
on Jan 14, 2010 at 9:33 pm

Senior from the South,

"My Senior household (age 67) pays about $6K for a house bought 18 years ago in the "poor" part of town. "

Maybe, but the taxes for your property would probably be about double if you'd bought that house last yeaThis is a transfer of wealth from young to old. If your wealthy octogenerian cannot afford the minimal taxes, then he or she should find another solution rather than shift i

Neighbor,

"This parcel tax is, as several people noted, a highly regressive tax." So is property tax in California.

"When someone with a small condo has to pay the same amount as HP with their acres of property, or someone with a $2million house, how can that be fair?????" So, do you think it's fair for people to pay four times as much property tax for as neighbors with identical property? No? Didn't think so.


Posted by Kate, a resident of Duveneck/St. Francis
on Jan 14, 2010 at 10:19 pm

To Fair is Fair:

EVERYBODY has a Prop 13 house. Read the rules. Someone who bought a house in 1990 has a Prop 13 house, and the taxes are less than someone who bought last week.. Someone who bought before 1978 has a pre-Prop 13 house when assessed valuations were set back to 1975. After 1978 taxes were set at 1% of the sales price which is used as the 'assessed valuation" , then everybody's taxes could only go up 2% a year. Taxes were going up yearly by 25%-30% EVERY YEAR before 1978. And just who is a 'senior" in this town? Please read the rules before you criticize. And .....when you retire, unless you have a lot of $$ in the bank, that lost paycheck is a real shocker. Repairing a senior roof costs the same as the person next door who is getting a good paycheck - maybe two. . Your gasoline and Safeway bill come out of your income as well as the senior next door who is on Social Security, and maybe - just maybe a pension but unlikely as the years go by and CD's or Money Markets at 1-3%.. So does the utility bill and the beat goes on. And the medical bills go up and up and up. Yes, there are some well-heeled seniors in Palo Alto, and then there are the rest - who can't eat the house. If seniors take out a loan, like a HELOC, they pay the interest - or try to live on Social Security, maybe a small pension, and "fixed income". It's really "fixed" right now. Seniors may need a new water heater, replace a twenty year old range, a new mattress, shoes. Costs are the same. So read the definition of Prop 13. Everybody has a Prop 13 house!! And by the way, on far less income that recent residents, 'seniors' paid the bonds to build most of Palo Alto's schools like Gunn and Cubberly and most of the grade schools. "Those were the days" and they were not easy.


Posted by common sense, a resident of Midtown
on Jan 14, 2010 at 11:03 pm

Fair is Fair,

About 46% of your property taxes goes to Palo Alto schools, 8% goes to the city of Palo Alto, and the rest goes to county, community colleges, etc.

When trying to determine "fairness", property taxes may not correlate to use of services. For example, two neighbors who bought their houses for the same price, pay the same property tax, but may have different number of children, so one neighbor gets more benefit from the schools than the other neighbor. Fair or unfair?

Businesses pay property taxes, which fund our schools, but they don't send any kids to our schools - fair or unfair?

The long term property owners are the ones who paid for the "infrastructure" of the city - the parks, community centers, etc. So the fact that they pay less in property tax doesn't bother me - they did their turn back in the 1950's, and 1960's, when an income $20,000 per year was alot of money.


Posted by Neighbor, a resident of Greenmeadow
on Jan 15, 2010 at 1:16 am

Fair is Fair: "So, do you think it's fair for people to pay four times as much property tax for as neighbors with identical property? No? Didn't think so."

I'm one of those paying 4 times that of neighbors with identical property, so, no, I don't think the state tax structure is entirely fair. However, the topic I was addressing was the parcel tax to be considered by PA, not Prop 13 consequences. We can influence the fairness problems associated with the parcel tax by voting NO (I like to stick to the things I can do something about).

In response to the comments about teacher salaries: my point was that it seems blatantly unfair to argue for a parcel tax "needed" to increase teacher salaries or benefits when that tax will fall disproportionately on residents who are at the same or lower income level -- that is what will happen if the regressive parcel tax bill passes. This is not the same thing as saying I believe teachers should not be paid good salaries. It IS saying that teachers and other publically supported employees should be willing make the same sacrifices many public and private employees have already made -- skipping raises until the economy improves. Seems like a reasonable expectation to me.


Posted by maybe Fair has a point, a resident of Meadow Park
on Jan 15, 2010 at 5:54 am

Tell you what..to make it all really, really fair, let's just go back to everyone buying whatever house they can afford in cash, and renting from others if they can't buy one.

Then each person pays for his OWN child's education, that way only those with kids pay, and each pays for the number of kids each has.

And, each pays for the road in front of his OWN house, whether or not he rents or buys.

And, each pays for his OWN food, without anyone else chipping in who happens to have more.

And, each pays for his OWN health care, without anyone else subsidizing him or his kids in any way. ..wait a sec, that is how it was for the first 150 years of this country..maybe Fair is Fair has a point. hmmm...


Posted by Toady, a resident of Old Palo Alto
on Jan 15, 2010 at 7:27 am

"When someone with a small condo has to pay the same amount as HP with their acres of property, or someone with a $2million house, how can that be fair?????"

This logic cracks me up. Who is the arbiter of "fair?" Are you saying that people who have a house valued at $2M should also pay more for milk?

What a ridiculous statement.

As for Kate's rant on seniors somehow deserving to live in Palo Alto - sorry I don't buy that. Having a house is like having a car - if you own it, you gotta be able to maintain it. Otherwise don't own it. If people can't afford to maintain the roof over their heads, regardless of situation, perhaps they should be looking for cheaper digs?

Prop 13 is retarded, just as much as rent control is in San Francisco. All it does is distort the market, making newer residents disproportionally cover the market costs and expenses. And all it does is ossify neighborhoods.

It's a vicious cycle - folks in houses for a while can't move because they wouldn't be able to afford it, which then restricts the market even more, causing prices to continue to shoot up.

This nonsense about fairness and all that is hysterical.


Posted by Resident, a resident of Another Palo Alto neighborhood
on Jan 15, 2010 at 7:48 am

Shame on those of you who think that seniors should be forced out of their homes or forced into debt to pay taxes. I hope that you will be able to stay in your home when you retire.

However, if there is an option for seniors to opt out of paying taxes then I do think that seniors should not be able to vote on this issue. If they can opt out, they will of course vote yes as it won't affect them but they will reap the benefits of it.

I have a great deal of respect for the seniors who live near me. In the past ten years several elderly neighbors have either moved into assisted living facilities or died and their homes are either rented out or sold. I miss the old folks, they had time to chat to me, giving me advice on helping me teach the kids to ride their bikes, or my tomato plants, or lending me a charger to get my car flat battery going. They had stories to tell of what the neighborhood was like when their kids were growing up and knew the history of all sorts of local issues. Although my new neighbors are pleasant, they are very different from their predecessors and I think the neighborhood is sadly missing something rather charming. They were part of the community and I feel privileged to have been part of their lives as they were of mine.


Posted by Neighbor, a resident of Greenmeadow
on Jan 15, 2010 at 8:45 am

Ok, Toady, let's remove "unfair" from the concerns about the parcel tax and replace it with "logical". Is it logical that, as is true of this regressive parcel tax, the lower the value of your house, the higher your tax rate? If you want to use milk as an example, than ask if it is fair for someone who buys quart of milk to be charged the same sales tax as someone who buys a gallon. I think not.


Posted by Fair is Fair, a resident of Barron Park
on Jan 15, 2010 at 9:03 am

Kate,

"EVERYBODY has a Prop 13 house." Do you have a point? Mine was simply that the effect of prop 13 is a transfer of wealth--often from the young to the old.

"Yes, there are some well-heeled seniors in Palo Alto, and then there are the rest - who can't eat the house." If they own a home in PA, then they are well-heeled. As for not eating the house, that is their choice.

Common,

"When trying to determine "fairness", property taxes may not correlate to use of services." That is the premise of taxation (and insurance, for that matter), and I'm all for it. Share the burden.

"For example, two neighbors who bought their houses for the same price, pay the same property tax, but may have different number of children, so one neighbor gets more benefit from the schools than the other neighbor. Fair or unfair?" Obviously, they don't pay the same tax because we have prop 13 to mess things up. Property tax is a tax on wealth and the premise does not take into account issues like number of children. Income tax does. I don't see a problem there. Different taxes.

"The long term property owners are the ones who paid for the "infrastructure" of the city - the parks, community centers, etc." Er, so what? Are you proposing that past taxes absolve you from future taxes? Then newer owners would be overjoyed.

Neighbor,

I too will be voting no.

However, I think you're off base complaining about teacher salaries. Teacher salaries are not "prorated." They make what they make, and good teachers put in tons of "overtime" during the school year and during the summer to ensure they do their jobs well. The teachers have foregone their raises this year, I believe.

Resident,

Nobody thinks seniors should be forced out of their homes. By the same token, young people should not be prevented from buying just because seniors want a free ride. Everyone should pay their own way.


Posted by Toady, a resident of Old Palo Alto
on Jan 15, 2010 at 9:08 am

Neighbor - if you want, I can continue down that path. That person buying the $2M house *already paid* higher taxes on the single transaction when they bought the house. Just like that person buying more milk.

So, let me understand this. Let's say there's a couple with no kids because, say, they can't have them in a $2M house should pay more in a parcel tax than a family with 3 kids in PAUSD schools because they happen to live in a house that a grandparent passed along to them with a lower assessment?

And the reason why it's $2M is because of stupid Prop 13 distorting the market?

And, oh by the way, a parent in that family in that "less than $2M" house happens to makes, oh, $500K a year?

So, let me ask - what's "regressive?"


Posted by Resident, a resident of Another Palo Alto neighborhood
on Jan 15, 2010 at 9:25 am

Fair

Yes, if you read through the posts, some are saying that the seniors who can't afford to live in Palo Alto should either move or go into debt (liens). It may not be the same as to whether they can afford to eat, reroof or buy a new furnace, but increasing their taxes either by library bonds, school parcel taxes or even a bond for a hospital in San Jose that we are also paying for in our taxes, just may be the deciding factor in whether they continue to live in Palo Alto or be forced to move somewhere cheaper. Is that fair, I for one don't think so.


Posted by Toady, a resident of Old Palo Alto
on Jan 15, 2010 at 11:40 am

I don't get the thinking that taxes are separate from other costs of maintaining the house.

The cost of living in a house is the cost of living in the house. Period. Whether it be taxes or repairing your driveway, it's simply the cost of owning a house.

So, are you telling by virtue of age, you should get a discount on contractors to fix your house too? Get a discount on landscaping? Get a discount from Home Depot in general?

Using your strange logic, you're saying yes to that nonsense.


Posted by Fair is Fair, a resident of Barron Park
on Jan 15, 2010 at 11:53 am

", some are saying that the seniors who can't afford to live in Palo Alto should either move or go into debt (liens)." What's wrong with that? Seems fair for all, young and old, to pay the same.

I mean, you want to give people whose houses have run up to a million plus, you want to give these wealthy people a tax break? Why? When they sell the house, do you think they're going to forego their gain--are they going to donate the gain to the county? Seems unlikely.


Posted by chris, a resident of University South
on Jan 15, 2010 at 1:03 pm

NOT THE IRS,

You know how only the part of the DMV fee that is based on the value of your car is deductible on your Federal income tax return.

It is the same thing with property tax. Only the portion of the property tax based on the value of the house is deductible.
Parcel taxes and other per property taxes are not deductible.

Would you trust a politician for tax advice? Ask them to indemnify you and see what they say.


Posted by Neighbor, a resident of Greenmeadow
on Jan 15, 2010 at 4:00 pm

Fair is Fair -- please allow me to clarify what I was trying to convey about teacher's salaries. The average monthly salary is $9222/mo. That's a pretty decent salary -- certainly not classified as a high salay in such a high COL area, but pretty decent. Yes, teachers work SOME in the summer, but typically only a short period at the end of a school year, and a few weeks prior to the beginning of a new school year. If they choose to spend time taking extra education-related courses in the summer, they are then given a pay raise, which means they are compensated for their time. And before anyone says their compensation for that extra time isn't much, it equals approximately $4100 (5%) in the first year alone, which is at least $100/hour.

Believe me, I would never argue that our teachers are overpaid. My point was that to raise salaries in the current economy, and to raise them by taking money at a disproportionate rate from those who are likely to have similar, or even lower income is not justifiable (in my humble opinion). I believe the current salaries are sufficient for weathering the current fiscal crisis. Let's revisit the issue when so many in our community are not already stretched to the limit.

Toady: Let's stick with the parcel tax issue. Mixing it with the many inequities associated with Prop 13 only confuses the issue. The parcel tax is going to be up for vote in a few months. It is something we can make a decision about now. It helps (me, anyway) to stay focused on the issue at hand, rather than what was, could be, or should be about Prop 13, or even what could be or should be about about the parcel tax. The issue at hand is do we want to support the parcel tax, or do we not. Period. The cost of milk relative to income has nothing to do with this vote. You buy milk, pay tax, buy milk again, pay tax again. The property taxes we pay are, in effect, set up so that we can keep buying "milk" (educate our young, fix our roads, protect our citizens each and every year, not just the year in which we purchased our home).

How many people are living in a house has nothing to do with this vote either. Our only decision is whether or not we should support a parcel tax this spring AS WRITTEN. My personal opinion is no.

Why?

1. That people can vote for it and then opt out of paying doesn't make sense to me, regardless of the group allowed to opt out. If you can opt out, you should have no say in whether others have to pay the tax. The potential income associated with those opting out of the last parcel tax equaled a minimum of $600k each year the parcel tax was collected(based on between 1200 and 1300 senior households). Over 4 years, that's $2.4 million of tax money. Can't tell you how many voted for the tax and opted out because no one collected or collected but would not provide those statistics (not sure which).

2. Many residents of Palo Alto (obviously not all) have been hit hard during the financial fallout of the past few years. This tax is a regressive tax -- that's not my personal opinion, it's a fact that can be substantiated by anyone familiar with the definition of a regressive tax. In a regressive tax, the less you earn, the higher your tax rate. Of course their are different ideas about who should or shouldn't decide what is fair, but this isn't an existential question we're trying to answer. Those with lower property values paying a higher tax to value ratio seems blatantly unfair to me. Just my opinion.

3. Although I have not raised this before, I also have concerns about the level of accountability for previously supported parcel tax and school bond money that has gone to PA schools and am disinclined to continue to pay additional monies without full disclosure of how previous funds have been spent.

All of that said, have a great weekend everyone!


Posted by Albert Henning, a resident of Duveneck/St. Francis
on Jan 15, 2010 at 4:13 pm

I'm always amused by the high-dudgeon nature of the responses on threads here related to taxes. Or, I would be amused, if the subject were not so serious.

If we do not educate our children, our society will fail.

It is therefore the responsibility of society to provide standards for education, and to deliver to our children the means to achieve those standards.

Old people are not exempt or apart from society. Neither are low-income people. We all bear the responsibility.

Prop 13 is, unequivocally, the greatest transfer of wealth from the young members of society to the old: that is, where 'old' is defined by those who do not move from one home to another for a long time. Prop 13 has caused California schools to go from 4th in the nation, to 48th, in terms of delivering to our children the means to achieve educational standards.

At the same time, Prop 13 cannot be overturned. It probably cannot be amended. Therefore, recognizing the essential nature of education, society has sought sources of funds to deliver education. That's where unfairness creeps in. The number of ways to raise money is limited. Parcel taxes have succeeded in the past. It is reasonable to expect they will succeed again. Fairness is not really a consideration (and I'm sorry about that). It is purely a matter of political pragmatism.

Note that communities around the country against which Palo Alto residents measure themselves (Chicago suburbs such as Winnetka, NY suburbs such as Chappaqua, Boston suburbs such as Newton, NJ suburbs such as Chatham) spend *twice* what Palo Alto spends on education, per student. Some of that amount is due to operational expenses: it's cold in those places, for instance, and heating oil costs money. However, teacher salaries tend to be higher in PA than in those places; which really means PA is under-funding physical plant, and supplemental programs, and has larger class sizes (proven to reduce educational effectiveness) relative to its perceived peer group.

PA spends maybe twice on average what other CA towns spend on education. Is that fair? Serrano v. Priest (1971) found it was not. But communities such as PA have found ways to circumvent the spirit, if not the letter, of Serrano. On the other hand, PA is receptive to students from outside of the community, to come here for their schooling, under several state programs.

The question remains, how much is enough to spend, in order that our students meet (and even exceed) the educational standards? As I said, relative to other CA towns, we spend more. Relative to out-of-state peers, we spend less. (Our physical plant is not good, but we have a bond issue to address the worst parts of that problem.)

But given that our students appear to perform well on standardized tests, one must ask: does the amount spent per pupil matter? Does the physical plant matter? Or are the results purely a matter of family resources? In short: at what tipping point does chronic underfunding of education erode the foundation on which our society is based?

These questions -- how much is fair, how much per pupil should be spent, does money affect outcome?, and so forth -- are important. In the end, however, there is no hard answer. Each of us must decide for ourselves, and vote accordingly.

I will vote for the tax, because a) I don't pay enough in property tax (because of Prop 13), b) I believe in Palo Alto as a fine place to live and raise a family, and c) even though my kids are grown, I believe every family's children deserve the same opportunity mine have enjoyed. I will always vote for money in favor of education, because education has made an enormous difference for my forebears, and will make a difference for those who come after me.

And I don't mind the senior exemption. Seniors are part of the community. They are valued and valuable, and should not be driven out. (My issue with Prop 13, therefore, is not it acknowledged an important problem, but that it went too far to 'solve' it.)

One last aside: if one wants to find out how much property tax is paid by one's neighbors, Zillow is a terrific resource.


Posted by no, albert, a resident of Crescent Park
on Jan 15, 2010 at 4:51 pm

Albert, you are perpetuating a myth. California spends more in inflation adjusted dollars per student now than before prop 13.

You claim California is 48'th in terms of delivering to its children, but you don't know anything about that. No one does; no one has measured the actual impact of schools on kids. Many of the children in California have parents who do not speak English, have broken homes, have tough emotional environments to deal with and in general are not ready to learn when they go to school.

The schools may well be delivering better than any other state, but have a tougher challenge than any other state.

More money to the schools is not the answer. We already are giving more money to the schools.


Posted by jim, a resident of Barron Park
on Jan 15, 2010 at 5:27 pm

The only fair task that we should do --- Change / cancel Prop 13. California needs to " Change " .


Posted by No Taxation without Investigation, a resident of Gunn High School
on Jan 15, 2010 at 7:36 pm

No Taxation without Investigation, we need to know and see proves of what Gunn is doing to alleviate the pain our children are going through for loosing their friends or classmates. We do not just want words, and promises.
Has Gunn done any investigation of its own? Did they share the reports with the parents of the children who past away?
I have a rule at my home. My kids cannot ask for money, permission to go somewhere if they have not done their job. This rule should apply to the District too.


Posted by Not the IRS, a resident of Barron Park
on Jan 15, 2010 at 10:22 pm

"You know how only the part of the DMV fee that is based on the value of your car is deductible on your Federal income tax return."

Sure, and the DMV is kind enough to list it separately on my bill with the note that it's tax deductible. It's one thing for people to assume that the parcel tax is deductible, but I'm sure you agree that it is something else for these voter information releases to specifically claim that they are deductible.


Posted by Not the IRS, a resident of Barron Park
on Jan 15, 2010 at 10:25 pm

"Has Gunn done any investigation of its own? Did they share the reports with the parents of the children who past away?"

What sort of investigation would this be and what authority would the school district have in probing into the private and non-school related lives of its students?


Posted by empty pockets, a resident of Fairmeadow
on Jan 16, 2010 at 4:27 pm

Look at the recent McKinsey study on the achievement gap in schools Web Link.
If the state of Texas can educate its kids better and cheaper than California then all we are doing is throwing money at a problem and not really looking to solve the problem.


Posted by chris, a resident of University South
on Jan 16, 2010 at 9:23 pm

Not the IRS,

What is your point?

Are you saying that you should believe a parcel tax supporter that the parcel tax is deductible even if the IRS won't put it in writing and the school district won't indemnify you? What authority does a piece of campaign literature have? Can you take that to Tax Court?


Posted by Not the IRS, a resident of Barron Park
on Jan 17, 2010 at 8:41 am

Chris,
My point is that if the campaign literature is advocating violating the law, I would have expected some specific correction from somewhere. Since parcel taxes are not uncommon in California, I tried to find a very simple statement on the California Franchise Tax Board or the IRS website stating that they are not deductible (the IRS does have the bit about deductible taxes must be based on the assessed value of the property, but then goes to say that local assessments that don't increase the value of the property are deductible) . Heck, I couldn't even find any official statements from opponents of parcel taxes (similar to those campaign releases from the pro-parcel tax folks) stating that they are not deductible.

I'm not arguing about the legality of the deduction, as I have no idea. I'm just surprised that it is so unclear. Going into more detail from the IRS, read Pub. 530 and you will fully confused since it implies that the SCVWD assessments are deductible even though they are technically "parcel" taxes. Interestingly, it states that non-deductible assessments (those that increase the value of your property) can be added to the cost basis. If that's the case, does that mean we can add the PAUSD parcel taxes to the cost basis of our property?


Posted by Fair is Fair, a resident of Barron Park
on Jan 17, 2010 at 8:50 am

Empty,

"If the state of Texas can educate its kids better and cheaper than California" Er, didn't you follow that story? Texas completely cooked its educational books. There's no telling how well they're educating their kids. As for the expense, CA costs of living are much higher, and much of our funding goes to salaries....


Posted by empty pockets, a resident of Fairmeadow
on Jan 17, 2010 at 8:55 am

Fair is Fair

Just to be fair read the McKinsey study before making a comment.


Posted by Fair is Fair, a resident of Barron Park
on Jan 17, 2010 at 8:38 pm

I've previously seen the McKinsey report. Garbage in, garbage out.

As I pointed out, TX has been cooking its numbers for years.


Posted by Midtown Parent, a resident of Midtown
on Jan 20, 2010 at 10:27 pm

Please stop arguing, and vote yes to Parcel Tax increase so the superintendent can get the 20,000 on his annual salary. The board already agreed to it. If the parcel increase does not go through where is the money going to come from to pay his salary increase?


Posted by George, a resident of University South
on Jan 21, 2010 at 11:20 am

Midtown Parent,

If you want the arguing to stop, you have the option of donating the $20K yourself. That would be fine by me.


Posted by a mom, a resident of Another Palo Alto neighborhood
on Jan 27, 2010 at 2:06 pm

Why did the school board vote for a 5% salary increase last year when the budget situation was already clear. Now they want the taxpayers to pick it up.


Posted by a mom, a resident of Another Palo Alto neighborhood
on Jan 27, 2010 at 2:08 pm

Why did the school board vote for a 5% salary increase last year when the budget situation was already clear. Now they want the taxpayers to pick it up.


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